Category Archive for Selling a Home
The Impact of Distressed Properties on Your Homes Value
May 11, 2011 · Comments
Within the past 12 months, there have been a total of 23 distressed property sales in Belmont (a mix of short sales and REO listings). Almost all of these homes have sold for far less than they would have if they were not distressed properties. Since they sell for less than standard sale homes, they impact the value of neighboring homes.
For example, let’s assume that a 3 bedroom/2 bath, 1700 Sq. ft. home that’s listed as a short sale closes escrow with a sales price of $800K. Had this property been listed as a regular sale, the sales price would have been closer to $875K (for simplicity, I’ll also assume that the property is in a decent location and in overall good condition). Now you’ve decided to put your house on the market and have received an offer of $900K. Now, unless your buyer is paying all cash for the property, the buyer’s lender will have to come in and perform an appraisal. If this short sale is right around the corner from you and has closed escrow withing the past 3 months, the appraiser is going to use it as a comparable sale. This leaves us with a $100,000 price difference, which means the appraised value will most likely come in at a lower value than your offer price, and in turn, the buyers will either have to come up with more down payment money or ask you, the seller, to reduce the price. I’m not saying that this will for sure happen, but I’ve seen it happen more and more frequently.
A good buyer or seller’s agent will meet the appraiser there and provide them with accurate comps, as well as point out any distressed properties that may have sold for less simply because they are a short sale or REO, and also be able to point out differences in comparable properties (i.e. a level yard vs. no yard, a view home vs. a home with no view, etc.). There are still a lot of REO properties that banks have been holding on to and are most likely going to be coming onto the market within the next 6 months to a year, so if you’re thinking of selling your home, be sure you speak to a local agent that can help you get your home on the market before values are further impacted by upcoming distressed properties.
Categories : Buying a home, Selling a Home
What Not To Do When Selling Your Belmont Home
March 30, 2010 · Comments
Selling a home entails many different facets. First there’s getting your house ready to put on the market, then there’s filling out all your disclosures, and then there’s the need to constantly have your home clean and everything in order in the event you have an interested party wanting to see it on short notice. I have seen and showed hundreds of homes, and can’t tell you how appalled I have been at times simply by the seller’s behavior. Let’s look at some of these scenarios.
1. Mr. or Mrs. Seller will only show their home strictly by appointment- Okay, I get it, people are busy, and don’t want prospective buyers trampling through your house at all times of the day, but if you want your house exposed to as many people as possible, which leads to a, you guessed it, quicker sale, your home needs to be available for people to see, especially in the first 2-3 weeks of it being on the market. Buyers are anxious, the minute a house that may interest them hits the market, chances are, they’re jumping in their car to drive by it. So do yourself a favor, make your house easy for people to see, and you won’t have to deal with the showings for that much longer.
2. Seller Follows Potential Buyer Around House- Ideally, as a seller, you would do yourself a favor to not be home when a prospective buyer walks through the door. Buyers want to open cabinets and closets, get a feel for the space, imagine themselves in it. Doing that becomes a challenge when Mr. or Mrs. Seller is yapping their ear off about how many times they’ve hosted Thanksgiving dinner in their dining room. If you must be home, let the buyers in, be courteous, then stay out of the way. Trust me, buyers feel uncomfortable walking through a house when the owner is there, and 90% of the time, will rush through the house because they don’t want to disturb the seller or take up too much of their time.
3. Mr. or Mrs. Seller have overly improved their home, and are unrealistic about their return on investment. While a spa and cabana in your back yard are nice amenities, they don’t necessarily mean that you will recapture the money you spent on it. Common mistakes I see: remodel is too taste specific (ultra modern finishes or bright colors). Sure, paint can easily be changed out, but that red granite in the bathroom may not appeal to all buyers. Some good improvements to make: Replacing the roof, it needed, dual pane windows, remodeling kitchens and baths in neutral colors that can be customized with accessories and paint to suit your taste.
4. Mr. or Mrs. Seller think their home is worth $1,000,000, when most other comparable homes have sold for much less. This has to be the worst, yet very common mistake, that many sellers make. Over pricing your home is probably the number one mistake that sellers often make. You get the most showings and interest when your home first comes on the market. Drastically overpricing your home from the beginning means that most likely, you will be chasing the market, and ultimately, sell your home for less than what you could have had you priced it at market value from the get go. My advice? Look at the comps, be objective, and look at your home through the eyes of a buyer. Things that you have learned to live with and don’t bother you can be glaring to a buyer.
There are a number of things that you can do to get your home ready for sale, and the best part of it, some if it costs little to nothing. Remember, be objective, and listen to your agent. A listing agent should be able to give you honest advice about changes to be made, pricing, and negotiating offers. If you don’t trust your agents advice, chances are, you’re not working with the agent that’s right for you.
Categories : Selling a Home, Uncategorized
